EXCL - FY23 results beat estimates

EXCL - FY23 results beat estimates XL Axiata (EXCL)'s 4Q23 EBITDA came in at IDR4.01 tn, or flat qoq. Yet, this brought FY2023 EBITDA of IDR15.53 tn, or beating ours/consensus by 2.7%/0.8%. Furthermore, EBITDA margin declined in quarterly basis to 47.5% in 4Q23 on the back of sales and marketing expenses that significantly jumped as it may have backloaded such expenses in previous quarter, coupled with an increase in infrastructure expenses. Meanwhile, 4Q23 revenue grew 4.3% qoq to IDR8.46 tn, resulting in FY23 top-line to increase by 10.9% yoy to IDR32.32 tn, which was above ours/consensus by 2.8%/2.6%. This was supported by managed IT service and data revenue, in line with stabilized data yields and higher ARPU at IDR45.8K/ sub, indicating sustainable improvement in the industry. On the other hand, EXCL’s number of subs held up at 55.9 mn in FY23. In terms of FMC, EXCL’s convergence penetration rose to 75% in 4Q23 as it expanded XL Satu coverage in 86 cities across the country. Management guides for high single digit revenue growth in 2024 with EBITDA margin at c.50%. (Source : Company)